Parliamentary Election campaign scenario remains unchanged

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April 22, 2016 18:16

The authorities will control the main stage of the campaign: counting the votes. This year’s scenario remains unchanged for the opposition and becomes a ‘test trial’ for the members of quaNGO “Belaya Rus” [White Russia].

By August 9, 6301 district election commissions for the parliamentary elections in September were formed. Among 68,945 commissions’ members less than 0.1% is the opposition.

Two main quangos, “Belaya Rus” and the Federation of Trade Unions of Belarus have been extraordinary active during this campaign. There will be 4189 (6.1%) members of “Belaya Rus” represented in the precinct election commissions and 9418 representatives of the FPB (13.7%).

Belaya Rus” leadership had repeatedly emphasized its readiness to support the governmental policy during this campaign therefore work of “Belaya Rus” activists in the election commissions would be put through a loyalty to the authorities’ test. “Belaya Rus” is taking part in the elections to test its capabilities and assets for the organization of local, parliamentary and presidential election campaigns in the future.

At the same time, representation of opposition parties and movements in the local election commissions is very low. For example, political parties “Fair World”, Belarusian Social Democratic Party (Gromada), United Civil Party, and the BPF managed to register 61 representatives in the precinct election commissions all together (with zero representation in the Minsk city).

Therefore, there are no changes in the way the ongoing election campaign is carried out. The deterioration of the Belarusian foreign relations, namely, the Swedish-Belarusian diplomatic row also lies within the usual trend. In this context, there are little chances anything might change: very little time is left before the 23rd September, the Election Day.

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Growth in real wages may disrupt macroeconomic balance in Belarus
October 02, 2017 12:12
Фото: Дмитрий Брушко, TUT.BY

The rapid increase in wages has led to a decline in the ratio between labour productivity and real wages to one. Previously, the rule was that enterprises, in which the state owned more than 50% of shares in the founding capital, were not allowed increasing salaries if this ratio was equal to or less than one. The authorities are unlikely to be able to meet the wage growth requirement without long-term consequences for the economy. Hence, the government is likely to contain wage growth for the sake of economic growth.

According to Belstat, In January – August 2017, GDP growth was 1.6%. The economic revival has led to an increase in wages. In August, the average monthly wage was BYN 844.4 or USD 435, i.e. grew by 6.6% since early 2017, adjusted for inflation. This has reduced the ratio between labour productivity and real wages from 1.03 in January 2017 to 1 in the first seven months of 2017. This parameter should not be less than 1, otherwise, the economy starts accumulating imbalances.

The need for faster growth in labour productivity over wage growth was stated in Decree No 744 of July 31st, 2014. The decree enabled wages growth at state organizations and organizations with more than 50% of state-owned shares only if the ratio between growth in labour productivity and wages was higher than 1. Taking into account the state's share in the economy, this rule has had impact on most of the country's key enterprises. In 2013 -2014 wages grew rapidly, which resulted in devaluation in 2014-2015.

Faster wage growth as compared with growth in labour productivity carries a number of risks. Enterprises increase cost of wages, which subsequently leads to a decrease in the competitiveness of products on the domestic and foreign markets. In construction, wholesale, retail trade, and some other industries the growth rate of prime cost in 2017 outpaces the dynamics of revenue growth. This is likely to lead to a decrease in profits and a decrease in investments for further development. Amid wage growth, the population is likely to increase import consumption and reduce currency sales, which would reduce the National Bank's ability to repay foreign and domestic liabilities.

The Belarusian government is facing a dilemma – either to comply with the president’s requirement of a BYN 1000 monthly wage, which could lead to new economic imbalances and could further affect the national currency value, or to suspend the wage growth in order to retain the achieved economic results. That said, the first option bears a greater number of negative consequences for the nomenclature.

Overall, the rapid growth in wages no longer corresponds the pace of economic development. The government is likely to retain the economic growth and retrain further growth in wages. Staff reshuffles are unlikely to follow the failure to meet the wage growth requirement.

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